Target quarterly profits to exceed expectations despite data breach

Piper said it now expects Target's same-store sales to increase by 1.5 percent for the quarter. That's an increase from its previous forecast of flat sales, even after the recent credit card data breach at the Minneapolis-based retailer.

According to the Minneapolis St. Paul Business Journal, Piper points to improved customer sentiment in December. The electronics category was particularly strong especially with the launch of the PlayStation 4 and Xbox One gaming consoles.

Piper said that consumers appear to have "responded well" to Target's holiday offerings.

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Target offered shoppers a 10 percent discount the weekend before Christmas, after news of the massive data breach that affected nearly 40 million customer credit and debit cards.

Analyst Sean Naughton told the Associated Press even with those setbacks, Target was on track for its biggest gain in a year for the key sales measure. Naughton's prediction is based partly on Target allowing shoppers to buy things online then pick them up at the store, which he said was well received.

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On the news, shares of Target closed out at $63.27 and the company's stock is up 8 percent over the last 12 months.